The Economy of Renaissance Florence

Appendix: Changing Values of the Florin

a ppe n d i x Changing Values of the Florin This appendix is designed to help the reader understand certain problems about the Florentine monetary system that emerge in the course of the economic history of the city as presented in the text of this book, namely, what is meant by the “price” of the florin, how to compare values in florins across time, how the monetary system helped shape the economic culture of Florentines, and the importance of the monetary system as an indicator of the government’s economic policy. The Price of the Florin Florence had a bimetallic monetary system, with various silver-based and billon coins, on the one hand, and a single gold coin, the florin, on the other. The silver coins derived from the silver denarius, or denaro, created by the Carolingian reforms, which became the principal coin in early medieval Europe. Since 240 denari were coined from one pound (libbra , or lira) of silver, the term lira came to be used as a money of account to express that multiple of denari, and a submultiple, the soldo, was used to express 12 denari, or one-twentieth of the lira; the soldo and the lira did not exist as coins. Thus emerged what is called the £/s/d system, with 12 denari equal to 1 soldo and 20 soldi, or 240 denari, equal to a lira. The lira with its subdivision into soldi and these into denari was a money of account that remained the basis of the monetary system for most of Europe, including Florence, throughout the entire period covered in this volume and on into the eighteenth century. This practice of dividing units into twentieths and then dividing those into twelfths, along with the use of the terms soldo and denaro for these fractions, became the basis for the mensural system used by Florentines for other things besides moneys (see chapter 7). After the demise of the Carolingian empire, governments minted their own denaro according to different standards of purity, and over the following centuries a slow and steady debasement varying from place to place meant that 240 denari no longer equaled a pound of silver, thus uprooting the lira from any fixed value in silver. In the twelfth century the denaro minted by the two cities in Tuscany in the forefront of the economic expansion of Italy—Lucca and Pisa—had a silver content of about 0.7 grams, down from the 1.7 grams of the original Carolingian denarius. Accompanying this debasement was a For a more thorough description of all aspects of the Florentine monetary system, see Richard A. Goldthwaite and Giulio Mandich, Studi sulla moneta fiorentina (secoli XIII–XVI) (Florence, 1994). 610 Appendix need for coins of higher value to meet the exigencies of a rapidly growing international commercial economy. In the early thirteenth century both Lucca and Pisa, following the example of Venice and Genoa, coined a silver grosso worth 12 denari, or a soldo; and the Lucchese and Pisan denaro and grosso were the principal coins in circulation in Florence well into the thirteenth century. It was not until the middle years of that century that Florence began minting its own coins: a silver grosso in 1237, the gold florin in 1252, and a silver denaro a few years later, before 1260. Following the logic of the mensural system, the grosso contained 12 times the amount of silver in a denaro, and the florin contained the quantity of gold worth an amount in silver that was twenty times the amount of silver in a grosso, or 240 times the amount of silver in a denaro. Hence for a brief moment in the 1250s Florentine coins had a direct correspondence to the denominations of the £/s/d system : the florin was worth one lira and the grosso one soldo, and the denaro was the base coin. We call these values expressed in lire the coin’s price, as distinct from both its commodity value, or the quantity of gold or silver it contained, and its real value, or its purchasing power in the local market. The price in lire served as a single standard of measurement for bringing coins of different commodity content—in this instance gold and silver—into line with one another. The price of a coin is a way of relating its value to all other coins in the system; it in itself tells us nothing about either the coin’s commodity value or...